2019

MANUFACTURING

Shift in Focus

Need for speed, flexibility could bring manufacturing jobs
back to the U.S.

Industrial and
manufacturing jobs are leaving the United States. It’s a theme we’ve been
hearing for years.

According
to the Information Technology and Innovation Foundation, the United States lost
33.1% of its manufacturing jobs between 2000-2010,many outsourced
to countries where labor is cheaper and employment regulations are less strict.1
The Bureau of Labor Statistics reported a net loss of 800,000 U.S. jobs since
January 2009.2

But as costs overseas increase and organizations
reassess business models, could manufacturing jobs be rebounding in the United
States?

Maybe so, according to Michael Kotelec, executive vice president of DHR International, an
executive search firm in Silicon Valley, CA. Jobs at all levels are gradually
returning to U.S. locations among Fortune 500 companies, he
said. The Bureau of Labor Statistics data show that about 303,000 U.S.
manufacturing jobs have been created since December 2009.3

While
organizations are still being cautious, the best CEOs are acting now, Kotelec said, because they foresee a "talent war" emerging
as more organizations begin hiring.

"Companies are focusing on ‘strategic hires’ who can make an immediate impact on top and bottom lines
from day one while creating a competitive advantage in the global marketplace,"
he said.

According to Kotelec,
manufacturers are shifting to new sales systems that look to improve speed from
idea generation to the final product. This shift, Kotelec
explained, requires a new, globally integrated "factory of the future" that
allows for increased flexibility on the plant floor, common practices and
processes across multiple sites and production closer to the customer.

Organizations are now focused on increasing
responsiveness to market demand, and customers are looking at total cost of
ownership, extracting the maximum value rather than lowest price.

This has
caused manufacturers to consider the entire value chain of their business
model, and move designers, engineers and materials specialists closer to the
customer.

"When you can
include designers, engineers, suppliers and customers in the up-front design
activity to get it right the first time, you greatly accelerate the transfer
from prototype to mass production, saving significant sums while creating a
competitive advantage versus offshore competitors," Kotelec
said. "It’s difficult to do that quickly and efficiently across multiple time
zones."

Furthermore,
the industry is beginning to experience some drawbacks of outsourcing.

According to a study by consulting firm the
Hackett Group, production in China in 2005 was 31% cheaper than in advanced
nations. By next year, the gap is expected to be down to 16%—a difference
that’s small enough for U.S. production to make financial sense again.4

With this increased U.S. competitiveness, an
estimated 2 million to 3 million U.S. jobs could result in the next eight
years.5

In a 2011
study by ASQ and the Metrus Group, a research and
consulting firm, one-third of participating organizations said they had
reversed course on at least one outsourced function because it failed to meet
business objectives in productivity and quality.6

Despite signs jobs are returning, U.S. recovery
will be slow going.

According to the Hackett Group, at the current
pace of recovery, it will take 25 years to regain the U.S. factory jobs lost to
outsourcing since 2000.7

Still, Kotelec said he
believes U.S. manufacturing will regain some ground.

"When you consider everyone pays about the same
for materials, cheap labor cannot offset productivity, collocation improves
cycle times and our ability to be the most innovative nation in the world," Kotelec said. "America looks like a great place to
manufacture in the future."

BALDRIGE AWARD

Most Applicants Hail From Healthcare

Healthcare organizations
again make up the majority of organizations applying for this year’s Malcolm Baldrige National Quality Award.

Of the 39 organizations that submitted
applications, 25 are healthcare related, five are nonprofits or governmental
agencies, three are educational organizations, three are service companies, two
are small businesses, and one is a manufacturer.

For the first time this year—the 25th
anniversary of the award—organizations that are candidates for the award
also will be eligible for recognition of their best practices in six of the
seven Baldrige criteria categories, even if they are
not selected as an award recipient.

Recipients are expected to be
announced in late November and honored at a ceremony next April in
Baltimore. For more information about the award and profiles of previous award
recipients, visit www.baldrige.nist.gov.

BY THE NUMBERS

6,500

The approximate number of
certifications ASQ issued in the United States last year as part of its
partnership with the Manufacturing Institute. ASQ’s 17 certifications and its
complete training portfolio are included in the institute’s Manufacturing Skills
Certification System. The institute and the 15 other partner organizations
issued 84,738 certifications and various other credentials last year.

HEALTHCARE

New Grading System for Patient Safety

To highlight the best and
worst U.S. hospitals in terms of patient safety, a new grading system has been
developed by a panel of healthcare experts.

More than 2,600 hospitals have been graded using
publicly available data on patient injuries, medical and medication errors, and
infections. They then receive hospital safety scores of A-F, which are posted
at www.hospitalsafetyscore.org. Preliminary results showed that 729 hospitals
earned A’s, 679 earned B’s, and 1,243 earned C’s or lower.

QP ONLINE ON PAPER

Eavesdrop on the Conversation

This month,
listen to an audio interview with Stephen K. Hacker, author of the cover
article, "Change Ability" (pp. 16-20), discussing more about the importance of
the individual during an organizational transformation.

SURVEY

Study Shows Need for Internal Consultants

To grow quality’s role
and influence within organizations, the profession must develop closer ties to
the specific business areas it serves and consults with, and it must leverage
consistent, proven methods and formal approaches to projects and initiatives.

These were the findings of an Association of
Internal Management Consultants and ASQ study that surveyed more than 800
quality professionals earlier this year.

Only 19% of
survey respondents said their planning process was closely connected to their
client organization’s process. This showed an opportunity for quality to
strengthen those connections and grow partnerships with areas to which it
provides internal support and advice.

Another 60% of respondents said they use
consistent and approved methods when tackling projects and situations, and
another 65% said they deploy a formal project management approach.

The authors of the survey indicated this as a key
success factor in providing valued internal consulting-type services.

The
survey also determined the top challenges to quality’s expansion of its role
within organizations were:

Cross-functional team building and management.

Becoming known as a trusted advisor.

Becoming more involved with planning activities of client organizations.

ISO 14000

New CD Focuses on Environmental Standards

A new CD released by the International Organization for Standardization
(ISO), "ISO Standards and the Green Economy," packages together the entire ISO
14000 family of environmental management standards,
plus a collection of publications related to sustainability.

AWARDS

APQC Announces 3 Grayson Medal Recipients

H.
James Harrington, Deborah L. Hopen and Michael Perich were named the recipients of this year’s C. Jackson
Grayson Distinguished Quality Pioneer Medal by the American Productivity &
Quality Center (APQC), a nonprofit best practices and benchmarking research
firm.

Harrington is CEO and chairman of the Harrington
Institute consultancy and a past ASQ president. Hopen
is president of Deborah Hopen Associates, another
consultancy. She also is a past ASQ president. Perich
is a consultant to Montgomery County Public Schools in Rockville, MD.

The medal recognizes people who have made a
difference by passionately promoting quality and process improvement tools and
concepts in education and not-for-profit sectors. For more details about the
recipients, visit www.apqc.org/grayson-medal.

Shortruns

TAG
ADDITION Ted Michaelis has been named a
member of the U.S. Technical Advisory Group to ISO/Technical Committee 176 on
quality management and the ASC Z1 subcommittee. Michaelis
is a senior project manager of quality management systems at Long Island Forum
for Technology in Bethpage, NY.

IN
THE SR SPOTLIGHT This year’s Pathways
to Social Responsibility: Successful Practices for Sustaining the Future has been released by ASQ. The
publication showcases effective practices and case studies from organizations
in different sectors that are integrating social responsibility into their
missions. The latest edition features 12 companies, including two Malcolm Baldrige National Quality Award recipients, one ASQ
Enterprise Member and an International Team Excellence Award Competition participant.
For more information, visit http://thesro.org/sro-stories.

QUALITY
IN ISRAEL The 19th International Conference of the Israel Society for
Quality will be held Oct. 22-24 in Jerusalem. The conference will be conducted
in English and Hebrew, with simultaneous translation in many sessions. For more
details and to register, visit www.isas.co.il/quality2012.

REASON
TO CELEBRATE National Healthcare Quality Week is
scheduled for Oct. 14-20 to help celebrate the dedication of healthcare quality
and patient safety professionals. For more information, visit www.nahq.org/membership/content/celebratehealthweek.html,
a website that includes ideas about planning events to mark the week.

BUSINESS-TO-BUSINESS
MATTERS A new International Organization for Standardization (ISO)
standard and technical specification (TS) was written to help build confidence
between partners in business-to-business dealings, and provide support for
trade regulations. The new standard, ISO/IEC 17020:2012, and the new TS,
ISO/IEC TS 17022:2012, relate to specific aspects of conformity assessment,
which refers to the processes used to demonstrate that a product, service, management
system or organization meets specified requirements, such as those of a
standard. For more information, visit www.iso.org/iso/pressrelease.htm?refid=ref1569.

Who’s Who in Q

NAME: Julie A. Furst-Bowe.

RESIDENCE: Edwardsville, IL, with a summer home in northern
Wisconsin.

EDUCATION: Doctorate in work, family and community education from
the University of Minnesota.

CURRENT JOB: Chancellor, Southern Illinois University-Edwardsville.

INTRODUCTION TO
QUALITY: Becoming a Baldrige examiner and having a leadership role in the
University of Wisconsin-Stout’s quality journey toward becoming the first
university to receive the Malcolm Baldrige National
Quality Award.

PREVIOUS EXPERIENCE: Provost and vice chancellor for academic and student
affairs, director of assessment and continuous improvement, and faculty member
at UW-Stout.

ASQ ACTIVITIES: Member of the Education Division leadership team;
author and reviewer for Approaches in Higher
Education journal; author for Higher Education Brief newsletter;
co-chair of ASQ STEM Conference; and instructor for the ASQ course, Baldrige Self-Assessment for Higher Education.

PUBLICATIONS: Has edited, written and contributed to several books,
including co-editing Advancing the STEM
Agenda: Quality Improvement Supports STEM
(ASQ Quality Press, 2012). Also a regular contributor to ASQ
newsletters and publications, including Higher Education Brief.

RECENT HONORS: Outstanding achievement award last year from the
Wisconsin Women in Higher Education Leadership organization.

PERSONAL: Married for 25 years to Daniel Bowe.

OTHER ACTIVITIES: Reading and walking.

QUALITY
QUOTE: Successful
organizations and successful individuals are guided by a long-term vision yet
have the discipline to systematically evaluate and improve their operations and
actions on a daily basis. They also create an environment that encourages and
supports lifelong learning for individuals and the organization.